Medicare Explained

Medicare can be quite overwhelming as you sort through your options and try to figure out what healthcare you need. For many of us, it’s the first time we really have to read the fine print, compare plans and understand the different options. But don’t worry, we’ve done the hard work for you and summarized Medicare in simple terms to help you find your best options. Once you have a level of comprehension under your belt, shop and compare Medicare plans to make sure you’re getting the best prices and coverage.

Medicare Plans

Medicare Part A

What is Medicare Part A?

Medicare Part A is sometimes referred to as hospital insurance and covers medically necessary hospital services and care. Medically necessary is deemed as; services, tests, or materials needed, according to accepted standards of medicine, to prevent, diagnose, or treat a malady.

What Does Medicare Part A Cover?

Generally speaking, Medicare Part A will cover in-hospital care such as:

Inpatient hospital care

Skilled nursing facility care

Nursing home care (custodial care is excluded)

Hospice

Home health services

It's important to note that Medicare Part A does not cover long-term care, custodial care, dental care, eye exams, dentures, costmetic surgery, acupuntcutreu, hear aids or hearing exams, or routine foot care. If you want insurance to help cover the costs of those services, there are several options. Most of these services are covered by Medicare Advantage and Medicare Advantage Plus programs – see what’s available in your area.

How Much Does Medicare Part A Cost?

Most people do not pay a monthly premium to receive Medicare Part A. You're eligible to receive "premium-free Part A" if you or your spouse has paid into Medicare through income taxes the years you worked.

You're eligible for premium-free Part at the age of 65 if:

You already receive Social Security or Railroad Retirement benefits

You're eligible to receive Social Security or Railroad Retirement benefits

You or your spouse had government employment that covered Medicare

You're eligible for premium-free Part under the age of 65 if:

You received Social Security or Railroad Retirement Board disability benefits for 24 months

If you are not eligible for premium-free Part A and need to purchase Part A, the monthly premium in 2015 is $407/month. Generally, if you need to buy Part A, you must also have Medicare Part B (Medical Insurance) and pay monthly premiums for both.

How do I sign-up for Medicare Part A?

Generally, if one of the following applies to you, you will be automatically enrolled in Medicare Part A. You should receive your Medicare card 3 months before your 65th birthday.

You are already receiving Social Security or Railroad Retirement benefits.

You suffer from a disability and are under the age of 65.

You suffer from ALS.

You will need to sign up for Medicare Part A if:

You are not yet receiving Social Security or RRB benefits (for example, if you have not yet retired and are still working).

You qualify for Medicare because you suffer from ESRD

When do I sign-up for Medicare Part A?

There are a few different times that you can sign up for Medicare Part A:

When you first become eligible

You have 3 months before and 3 months after your 65th birthday month to sign up for Medicare Part A.

Between January 1–March 31

Every year, the General Enrollment Period takes place between January 1–March 31.

Special Enrollment Period

If you're covered under a group plan and the plan ends (for example, if you're covered by an employer and stop working) you have 8 months to sign up for Medicare Part A.

Medicare Part B

What is Medicare Part B?

What Does Medicare Part B Cover?

Generally speaking, Medicare Part B will cover medically necessary tests, doctor visits and services to treat or diagnose a malady. It will also cover some preventative services where early detection is key to preventing illness. Some examples include:

The flu shot

Clinical research

Ambulances services

Medical equipment

Mental health services

Second opinions before a surgery

It's important to note that Medicare Part B does not cover long-term care, custodial care, dental care, eye exams, dentures, costmetic surgery, acupuntcutreu, hear aids or hearing exams, or routine foot care. If you want insurance to help cover the costs of those services, there are several options. Most of these services are covered by Medicare Advantage and Medicare Advantage Plus programs – see what’s available in your area.

How Much Does Medicare Part B Cost?

In 2015 most people will pay a monthly premium of $104.90 and $147 for the annual deductible for Medicare Part B. If your modified adjusted gross income from 2 years ago is above $85,000 the Medicare part B monthly premium costs more.

How do I sign-up for Medicare Part B?

Generally, if one of the following applies to you, you will be automatically enrolled in Medicare Part B. You should receive your Medicare card 3 months before your 65th birthday.

You are already receiving Social Security or Railroad Retirement benefits.

You suffer from a disability and are under the age of 65.

You suffer from ALS.

You will need to sign up for Medicare Part B if:

You are not yet receiving Social Security or RRB benefits (for example, if you have not yet retired and are still working).

You qualify for Medicare because you suffer from ESRD

When do I sign-up for Medicare Part B?

There are a few different times that you can sign up for Medicare Part B:

When you first become eligible

You have 3 months before and 3 months after your 65th birthday month to sign up for Medicare Part B.

Between January 1–March 31

Every year, the General Enrollment Period takes place between January 1–March 31.

Special Enrollment Period

If you're covered under a group plan and the plan ends (for example, if you're covered by an employer and stop working) you have 8 months to sign up for Medicare Part B.

Part B Late Enrollment Penalty:

Be aware, the penalty for failing to enroll in Medicare Part B when you first become eligible is that when you do enroll, you will have to pay higher premiums for as long as you have Medicare. For every 12 months that you fail to sign up for Part B, you're monthly premiums can go up 10%.

Medicare Advantage (Part C)

Part C is more commonly known as Medicare Advantage. It is basically the kind of healthcare coverage you’ve been used to if you have previously had individual or employer-based health insurance. There are premiums, deductibles, and a set of doctors from which to choose. Usually, Medicare Advantage plans also include Part D, which helps you pay for drug prescriptions.

Medicare Supplemental Insurance

Medicare Supplemental Insurance, or MediGap, is insurance on top of your Original Medicare insurance and pays a portion of deductibles, co-payments, and co-insurance for Part A and Part B services. Medicare Supplemental Insurance has standardized plans A through N and the percent of out-of-pocket expenses covered depends on the standardized plan you select. You cannot have both Medicare Advantage and Medicare Supplemental Insurance; it’s one or the other. Compare premiums from each to help determine your best solution.

So, What Do I Pay?

With Original Medicare, the government generally pays 75% of the healthcare bill. One important thing to remember is that Medicare is INDIVIDUAL, even if some of your premiums are based on a joint household income, each eligible person will pay their own premium. For most people, Part B premiums will be $104.90 this year For most people, Part A has no premiums.

Additional Medicare Resources

Medicare-Plans.org is not a licensed health insurance carrier, and we are unable to directly issue health insurance policies, or alter existing policies. If you wish to inquire about your current plan, please contact your health insurance provider for more information.